Ponty Chadha's successor 'Monty' to face first major challenge

LUCKNOW: The successors of slain liquor baron Gurdeep Singh 'Ponty' Chadha will soon face their first major challenge as the wholesale rights for liquor trade in Uttar Pradesh, grabbed by Chadha, come up for renewal in March 2013.

It was this contract and vending rights for 12 western UP districts given out by the Mayawati government in 2008-09 that made Ponty the undisputed king of UP's liquor business and catapulted him to the helm of a 20,000-crore business empire spanning liquor trade, real estate, sugar manufacturing, entertainment and poultry. The contract, which will expire on March 31, 2013, gave Chadha control over 80% of the state's 14,000-crore liquor business (2011 government data), and he made a killing buying cheap from companies and selling at fat margins.

Ponty's 30-year-old son Manpreet 'Monty' Chadha, a class IX dropout from Welham's Boys School in Dehradun who is the joint managing director of the family's holding company Wave Inc, has been groomed as his father's successor.

While it is possible that Monty's uncle Rajinder Chadha, who is currently the MD of Wave, may be made chairman and head of the group as the family copes with the aftermath of the shootout, observers said that for the past one year, Monty had been taking an interest in the lucrative liquor business and was working on his relationship with the political bosses in UP, Punjab, Haryana and Uttarakhand.

Bagging UP Contract Won't be Easy

Monty was present at the swearing in ceremony of Akhilesh Yadav as UP's chief minister in March this year, and is said to have built good relations with top decision-makers in the state government.

But bagging the contract will not be easy and will be test case of whether Ponty's clout and network of political connections are transferable. UP, which has an excise tax collection target through liquor trade of a little more than 10,000 crore in 2012-13, is being eyed by the erstwhile bigwigs of the trade such as Jawahar Lal Jaiswal, Badri Prasad Jaiswal, Rakesh Pandey and Ashok Wadia, who were put out of business after Ponty secured the entire wholesale rights of liquor and liquor vends in a dozen lucrative western UP districts. Others such as Rakesh Ahuja, Har Prasad Jaiswal and Tilak Raj Sharma had either exited the business or joined hands with Chadha. These rivals-turned-partners are expected to raise their heads once again.

Also, the state government will be cautious in granting the contracts this time around as previous deals with Chadha have come under the scrutiny. The contentious 2008 excise policy that led to Chadha's monopoly in the state had helped UP increase its excise revenue over the past three years. It has also put a lid on inter-state smuggling of liquor. But it was seen as favouring the Chadhas. The preliminary process of distributing wholesale and liquor vend licences for 2013-14 will begin by December-end.

While Wave Inc, controlled by the three Chadha brothers - Ponty, Hardeep (both of whom died on Saturday) and Rajinder - and Monty, had diversified into real estate, sugar mills, paper mills, film production and multiplexes, the liquor business, spread over several states of North India, is the group's real money-making machine. The group's Great Value Foods has been shortlisted for the 9,000-crore contract for supply of nutritional supplements and mid-day meals under the Integrated Child Development Scheme over the next three years in UP.

In the past one year, Monty has been pitched by his father as the heir apparent (one of the alleged causes of friction with estranged brother Hardeep, which led to the fatal incidents on Saturday). Since being appointed joint MD of Wave Inc in September 2011, he has been involved in all areas of the group's diversified businesses even though he does not play a direct role in the day-to-day operations of the liquor distribution business.Â He runs the real estate and entertainment businesses, which he believes will help transform the group into a professionally-run, modern business house, said a person who has worked with him.

Of late, he has hired senior executives from big liquor companies such as United Breweries, and inducted top professionals from real estate companies like DLF and Unitech. Barbara Delinc, a Czech real estate marketer who worked with Jones Lang LaSalle in Germany, has been hired as Wave's marketing head.

Monty is said to favour a corporate style approach to business and has been running the show at Wave Infratech, which is developing the 132-acre real estate project in the heart of Noida and the 4,200-acre Wave City next to Ghaziabad.

He also supervises the operations of about half-a-dozen Wave multiplexes, breweries and the group's sugar mills in UP. He has also announced a 350-crore foray into the country's 30,000-crore poultry business.